Number Crunch H1 2022Analysis of the Nordic PE market in the first half of the year

37 sales by Nordic venture companies were completed in the first half of 2022. This is the lowest number since H1 2020. Compared to 2021, there was a decrease of 40 per cent, and 27 per cent compared to the average over the last five years. The valuation of many early-stage technology companies has fallen in early 2022. It may be that the correction in valuation means that fund managers choose to wait to exit and to further develop the companies instead.

Major sales include:

• The accounting app, Bokio, was sold to Visma by Creandum. The transaction valued the company at over SEK 1 billion (read more).
• Leadfeeder was merged with Echobot in a transaction that valued the company at EUR 180 million. The sellers of Leadfeeder were, among others, Endeit Capital, Superhero Capital and Vendep Capital (read more).
• Industrifonden sold InRiver to the fund manager THL Partners. InRiver operates within product information management and raised SEK 4 billion (read more).
• CapMan sold the Finnish semiconductor specialist, Picosun. The sale of the 200-employee company is CapMan's largest sale ever (read more).
• Norwegian Papirfly was sold to Verdane by Standout Capital. The software company is one of the leading European companies in brand management (read more).

Almost three out of four companies sold in the venture segment were technology companies, accounting for 73 per cent of sales. Other sectors with sales in the venture segment were the energy sector, the consumer sector and industry, accounting for 8 per cent in each sector. See the pie chart below.

Most sales involved Swedish companies, with 12 sales (32 per cent of sales). Norway is the only market where the relatively high sales activity from 2021 was maintained, with ten exits, corresponding to 27 per cent of sales. Ten sales (27 per cent) also involved Finnish companies, followed by Swedish companies, which were involved in 27 per cent of sales. Five sales (12 per cent) involved Danish companies. See the graph below.

Buyout funds completed a total of 50 sales of Nordic companies in the first half of 2022. After a very high level of activity in 2021, activity in the first half of 2022 has normalised and is down 28 per cent compared to the first half of 2021. It is up 2 per cent compared to the average for the first half of each of the last five years.

The largest transactions include:

• Summa Equity and Goldman Sachs Capital Partners sold Norwegian EcoOnline to Apax Partners in a transaction that valued the company at EUR 374 million (read more).
• PAI Partners sold Swedish Perstorp to Petronas Chemicals Group. Perstorp is engaged in sustainable production of chemicals, and was valued at EUR 2.3 billion in the transaction (read more).

Much of the sales activity still takes place in the secondary market, i.e. sale of companies between active owners funds. The proportion of secondary market sales was 32 per cent in the first half of 2022, down from 39 per cent of sales in the first half of 2021. The most common sales route remains sales to industrial players, which make up 48 per cent of sales transactions in buyout deals in the first half of 2022. See the pie chart below.

The sector distribution of sales in buyout deals shows 34 per cent of company sales within the industrial sector, followed by 32 per cent within the consumer sector. 14 per cent concerned health and life sciences and 10 and 6 per cent were within energy and ICT respectively. Most PE-backed sales involved Swedish companies (32%), followed by Danish companies (30%) and Norwegian (27%).

32 per cent of PE-backed sales involved Swedish companies, followed by 30 per cent involving Danish ones. 24 per cent involved Norwegian companies, while only 11 per cent of PE-backed sales involved Finnish companies. Compared to historical shares, the share of sales involving Norwegian companies is relatively high, while the share involving Finnish companies is correspondingly low. See the graph and pie chart below.

If we look at the sector within sales of Nordic buyout companies, it is industry, consumer and healthcare and life sciences that dominate after the first half of 2022.

After two years of very strong listing activity on Nordic exchanges, there have been very few PE-backed IPOs in the first half of 2021, amounting to six IPOs. Access to risk-averse capital on Nordic stock exchanges was very good in the two previous years, but activity slowed considerably after the stock market crash, particularly in technology shares. However, it is not at a complete standstill, with six IPOs in the first half of the year, the number is as high as in the whole of 2019. However, it is clear that exit through a stock market listing appears more risky in 2022 compared to the two previous years.

Only Norwegian and Swedish companies are represented in IPOs in the first half of 2022, with no Danish or Finnish IPOs. Five Swedish and one Norwegian portfolio company with PE-backing have been listed so far in 2022. Among the IPOs so far in 2022, we find HitecVision-owned Vår Energi, which was listed on the main list on Oslo Stock Exchange. It was one of the largest listings on the Oslo Stock Exchange ever. The table below shows all IPOs.